Why Invest in Real Estate?

- Example A: Buy a $250,000 house with 20% down ($50,000). At worst breakeven each month on your rent compared to your mortgage payment. Sell the home in 7 years at around $350,000 (based on an average annual appreciation of 5%, which is a safe estimate). After closing costs net a profit of around $75,000... that's a return on your original $50,000 investment of 150%. I haven't even included the tax advantages in this highly simplified example.

- Example B: Now compare that to a $50,000 investment in stocks, mutual funds, etc. Using a generous 7% annual return, that $50,000 will have only made you roughly $30,000 over seven years, or an ROI of 60%.

Example A is calculated on the safer side, while Example B is probably on the generous side (depending on the individual's portfolio). Still, a $50,000 investment in real estate returned the investor $45,000 more (an additional 90% ROI) than they would have gotten with the stock market (and that excludes any positive monthly cash flow the investor should get). This is a highly simplified example, but it does illustrate the effect of including real estate in your investment portfolio. Diversity is important, so investment real estate should supplement your portfolio as a whole... not replace stocks, bonds, etc entirely.

I Want To Be A Real Estate Investor - Where Do I Start?

Each real estate investor is different and has different goals for a real estate investment in the Bellevue, Seattle, and Puget Sound area.  Accordingly, we individually pair Bellevue and Seattle area real estate investments with investors based on their goals and financing capabilities.  Thanks to low prices, short sales, and bank owned / REO homes, our investors have had great luck with lease option investing, traditional rentals, and fix and flip homes all around King County and Puget Sound. 

Here are a couple of our recent deals we have done:

Lease Option Short Sale Investment - Here are the details and what our client said about his experience with our Investment Specialist, Aaron J. Rosen, after closing a $626 monthly cash flowing lease option negotiated for $26,450 under asking price:

"My experience in working with Aaron has been excellent. He has always worked to keep me in the loop on our dealings and has maintained a high level of integrity throughout our interactions. Based on working with Aaron I would absolutely refer him." - K. Berg

• City: Lynnwood
• Purchase Price: $203,500 (listed at $229,950)
• Tenant Buy Back Price: $241,500
• Tenant Payment: $1,813.79
• Investor Payment: $1,186.94
• Monthly Cash Flow: $626.85
• Gross Profit: $53,044.4
• ROI: Over 130%

Fix and Flip Investment - We just helped one of our investors purchase a home through a wholesaler we work with at 38 cents on the dollar! We helped guide him through what upgrades would yield the largest returns, and after the remodel, we listed and sold the home in 7 days!

• City: Tacoma
• Purchase Price: $52,000 (Assessed at $136,600)
• Remodel Cost: $40,000
• Sold Price: $176,000
• Gross Profit: $84,000

Be sure to check out: Lease Options | Bank Owned | Investor Seminar | Free Buyer Services

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Want to learn more about real estate investing or need help finding a real estate investment in the Bellevue, Seattle, and Puget Sound area? Just fill out the form below  or call or email us directly at 425-289-1099 or robertw@prosperarealestate.com